It’s Time to Raise Cigarette Taxes

While the politics of Washington often display gridlock and indecision, one issue could unite partisans and independents, conservatives and liberals alike: increasing retail tobacco taxes. The Campaign for Tobacco Free Kids reports that after analyzing more than 80 polls from every state, over 70 percent of Americans would like to raise tobacco taxes to help fund education. This support spans the political spectrum like no other issue in modern America.

Nevada currently has in place a 30 percent tax on wholesale cigarettes and a $1.80 retail tax per pack, though only $.80 of that goes to Nevada and the rest goes to the federal government.

Almost all our neighboring states tax more than we do, including Utah, which taxes $1.70 per pack, and Arizona, which taxes $2.00 per pack. That’s revenue that goes directly to the state, not the federal government. Our neighbors to the south and east are traditionally more hostile to taxes and often boast majorities in their respective state houses that have pledged to never raise any taxes, ever – yet their state cigarette taxes significantly are higher than Nevada’s.

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Image Source: the Campaign for Tobacco-Free Kids

Governor Sandoval has floated the idea of finding new revenue for the state in the coming legislative session. Raising the tobacco tax would do so without upsetting the newly elected conservative majorities in both houses of the Nevada Legislature. It would likely enjoy support from both parties. If Nevada raised the tobacco tax just $.56, to the median tax rate for the United States, the increase could generate $62 million dollars of additional revenue. If the state raised the tax to $4.35, as the state of New York has done, we would be well on our way to closing the gap on the $700 million dollars cut from the educationbudget in recent years.

Opponents say that increasing cigarette excise taxes hurts retailers and their employees. They say that revenue projections are overblown and angry consumers will simply go to neighboring states. These criticisms don’t hold water in Nevada, because all our neighboring states tax tobacco more than we do. It is possible that upset consumers will gravitate toward shops on Native American reservations, where the tax will not apply. This unintended consequence is not necessarily a bad thing as the country struggles with how to, and to what degree to, rectify racial injustices. This might be an additional step to compensating Native American tribes for generations of abuse.

Increasing the tobacco tax is a no brainier. The choice is clear. Let’s support public policy that has support among all facets of society, increases revenue and makes the population healthier, while also helping Native American tribes. The alternative – ignoring the problem and losing thousands of lives to lung cancer and related diseases – is unacceptable.